Anesthesia Coding Alert

Surprise: Get ready for two conversion factors.

The Centers for Medicare & Medicaid Services (CMS) has released its 2026 proposed rule for the Physician Fee Schedule (PFS).

Find out the ways in which your practice may be impacted by these proposed changes, and submit your comments no later than 5 p.m. on September 12, 2025. See the Federal Register for comment submission details.

Note This CF Proposed Change

In section 1.C, the proposed rule mentions a new innovation that will benefit participants in a CMS alternative payment model (APM): two conversion factors, “one for items and services furnished by a qualifying APM participant … and another for other items and services (referred to as the nonqualifying APM conversion factor).”

As a reminder, the CF is the final multiplier in the complicated formula known as the resource-based relative value scale (RBRVS), by which CMS calculates its payments for items and services.

Under the 2026 proposed rule, the qualifying APM conversion factor would be “a projected increase of $0.39 (1.2 percent) from the current conversion factor,” while “the 2026 nonqualifying APM conversion factor represents a projected increase of $0.23 (0.7 percent) from the current conversion factor.”

Brace Yourself for These Estimated Impacts to Your Bottom Line

CMS estimates the impact of the CF changes in section VII, along with “proposed changes to the allocation of indirect PE in the facility setting” will “have significant differential effects depending on the site of service.” 

In other words, if the proposed rule is enacted without change, and if your specialty practices in a facility setting, you could see some dramatic reductions in your practice revenue for 2026. Some examples:

In section II.N of the proposed rule, CMS addresses geographic practice cost indices (GCPIs), which could also affect your bottom line. Medicare is required to “measure relative cost differences among localities compared to the national average for each of the three fee schedule components (that is, work, practice expense (PE), and malpractice (MP)).” They then make the appropriate GCPI adjustments, which they’re required to review for potential adjustment every three years, and if more than a year passes, then the next adjustment is half of what would have been made.

The last GPCI update was implemented across 2023 and 2024; therefore, Medicare is proposing to phase in half of the GCPI adjustment in CY 2026 and the other half in CY 2027. CMS says they’re proposing new GPCIs for CY 2026.

Will Medicare Revalue Certain Codes in 2026?

In section II.C, “Potentially Misvalued Services Under the PFS,” CMS examines codes that nominators submitted for possible revaluation. Individuals or organizations that nominate services for reconsideration submit their reasoning for why the codes should have their values reviewed due to, for example, changes in technologies, greater time required to complete the service, or increased cost of materials.

For CY 2026, CMS received 11 requests for codes as potentially misvalued codes (PMVC) and did not propose any to nominate as “potentially misvalued.” The agency requested more information from commenters to make a decision regarding the codes’ valuation fate.

Understand Proposed Changes to Telehealth Services

Currently, to amend the Medicare Telehealth Services List, requestors must go through a five-step process to be added to, deleted from, or revised on the list. In section II.D, CMS is proposing to consolidate this process, so services on the list would no longer receive “provisional” or “permanent” designations and would be listed or added to the list on a permanent basis. CMS proposes eliminating the last two steps of the review process and creating a three-step review process for approval.

Code changes: CMS is proposing adding the following services to the Medicare Telehealth Services List in 2026:

• 90849 (Multiple-family group psychotherapy)
• G0473 (Face-to-face behavioral counseling for obesity, group (2-10), 30 minutes)
• G0545 (Visit complexity inherent to hospital inpatient or observation care associated with a confirmed or suspected infectious disease by an infectious diseases specialist, including disease transmission risk assessment and mitigation, public health investigation, analysis, and testing, and complex antimicrobial therapy counseling and treatment (add-on code, list separately in addition to hospital inpatient or observation evaluation and management visit, initial, same day discharge, subsequent or discharge))
• 92622 (Diagnostic analysis, programming, and verification of an auditory osseointegrated sound processor, any type; first 60 minutes)
• 92623 (… each additional 15 minutes (List separately in addition to code for primary procedure))

Limitations: For CY 2026, CMS is proposing removing limitations on the number of times physicians and other practitioners can use telehealth to provide services for subsequent inpatient visits, subsequent nursing facility visits, and critical care consultations.

Direct supervision: The agency is proposing that physicians or other supervising practitioners may provide direct supervision through real-time audio and visual interactive telecommunications for services that require direct supervision to be performed. Physicians and other supervising practitioners may provide direct supervision virtually for the following services that do not have a 10- or 90-day global period: applicable incident-to services, diagnostic tests, pulmonary rehabilitation services, cardiac rehabilitation, and intensive cardiac rehabilitation services.

Teaching physicians: CMS is proposing rescinding the policy of allowing teaching physicians to have a virtual presence for billing services furnished by residents. Instead, the agency recommends teaching physicians must be physically present for critical portions of services provided by residents when those services are provided within metropolitan statistical areas (MSAs).

Address Chronic Illness and Behavioral Health Care

In section II.I, CMS is proposing the creation of add-on codes for Advanced Primary Care Management (APCM) services, which are complementary to behavioral health integration (BHI) or psychiatric Collaborative Care Model (CoCM) services. The agency proposes creating three G codes that could be billed as “add-on services when the APCM base code is reported by the same practitioner in the same month,” according to the fact sheet.

The agency is also proposing to magnify its digital mental health treatment (DMHT) service payment policies. The change in the policies would allow for reimbursement for devices used to treat attention deficit hyperactivity disorder (ADHD). CMS is also seeking input on creating codes and payment policies for “other digital therapy devices classified under other [U.S. Food and Drug Administration (FDA)] regulations.”

Section II.G also proposes a trio of new add-on codes “to allow for payment under the PFS when BHI or CoCM are furnished in conjunction with APCM [advanced primary care management] services for practitioners who meet the requirements to furnish both services,” per the proposed rule.

“We are proposing the establishment of three new G-codes to be billed as add-on services when the APCM base code (HCPCS codes G0556, G0557, and G0558) is reported by the same practitioner in the same month,” CMS states.

The codes being proposed are:

• GPCM1: (Initial psychiatric collaborative care management, in the first calendar month of behavioral health care manager activities, in consultation with a psychiatric consultant and directed by the treating physician or other qualified health care professional… )
• GPCM2: (Subsequent psychiatric collaborative care management, in a subsequent month of behavioral health care manager activities…)
• GPCM3: (Care management services for behavioral health conditions, directed by a physician or other qualified health care professional, per calendar month…)

According to CMS, “these new HCPCS codes are designed to allow for the payment of services that, when reported as standalone services, are currently included in the definition of primary care services used for purposes of assignment when furnished in conjunction with APCM services: BHI (CPT codes 99484, 99492, 99493 and 99494), CoCM (HCPCS code G2214), and APCM (HCPCS codes G0556, G0557, and G0558).”

Check Changes to Skin Substitute Categorization and Payment

In Section II.K, CMS proposes that skin substitutes not regulated as biological products but be reimbursed as incident-to supplies in all non-facility and hospital outpatient encounters. CMS believes that this recategorization will help simplify the relevant HCPCS coding for skin substitute services, believing these items are an “integral, although incidental, part of the physician’s professional services.”

CMS Expands Descriptor of G2211

CMS is proposing in section II.F to include home health service visits to the code descriptor for G2211 would be “(Visit complexity inherent to evaluation and management…), enabling it to become an add-on code to evaluation and management (E/M) codes 99341-99350 (Home or residence visit for the evaluation and management of a new/established patient…) as well as the office/outpatient E/M codes.

Changes Coming to Global Surgery Payments?

In section II.L, CMS is proposing changes on how to report each portion of the global surgery package when more than one provider is involved. Right now, Medicare pays surgeons a fixed share of a global procedure’s valuation when they bill the procedure with specified modifiers, particularly modifier 54 (Surgical care only).

Currently, “procedure shares” are clustered at certain values for procedures depending on the global periods and there’s no clear-cut rule for dividing procedure share. CMS believes that reevaluating this system for global surgical packages will better align valuation and payment to the provider performing a specific portion of the global surgical service.

CMS says 2023 data suggests that the current system does not reflect the actual division of work between surgeons and providers of postoperative care and seeks public comments for further input.

Get Onboard With This Online MDPP Proposal

CMS is proposing in section III.D numerous changes to the Medicare Diabetes Prevention Program (MDPP), an evidence-based education program aimed at preventing or delaying the onset of type 2 diabetes for eligible beneficiaries with prediabetes. CMS is proposing that this content can now be delivered online asynchronous content. This is a trial period to determine how outcomes, including weight loss, compare to in-person and distance learning options.

To document online delivery for MDPP, CMS is proposing a new HCPCS code: G9871 (Behavioral counseling for diabetes prevention, online, 60 minutes)).

Drug Price Inflation a Target for Rebate Program

Section III.E of the proposed rule also looks to kickstart the Medicare Prescription Drug Inflation Rebate Program, in part by implement provisions of the Inflation Reduction Act of 2022 (IRA), which requires manufacturers of some single-source drugs and biological products to pay Medicare Part B rebates when prices increase faster than rate of inflation. The IRA has a proposed section for the same requirements applying to Medicare Part D.

CMS feels the rebate program is necessary in order to update the Quality Payment Program (QPP).

Revenue Cycle Insider Editorial Team